EFTA Document EFTA01353424

market on which an option series is traded should decrease the multiplier for the series, an adjustment panel may adjust outstanding options of that series. The exercise prices and premiums of the index op- tions that are traded at the date of this booklet are expressed in U.S. dollars. Subject to regulatory ap- proval. trading in index options whose exercise prices or premiums are expressed in a foreign currency may be introduced in the future. The total exercise price for a single option is the stated exercise price multiplied by the multiplier. Premiums for index options are expressed in points and fractions of points. Each point of premium of the options trading at the date of this booklet represents an amount equal to one U.S. dollar. In order to deter- mine the aggregate premium for a single index option, the quoted premium must be multiplied by the multiplier. EXAMPLE: An investor purchases a December 110 index call at 21/4 . The multiplier for that option is 100. The aggregate dollar amount of the premium is $212.50 ($21/4 times 100 = $212.50). Had the options market used a multiplier of 200, a premium of 21/4 would have meant an aggregate premium of $425.00. The exercise settlement values of stock index op- tions are determined by their reporting authorities in a variety of ways. The exercise settlement values of some index options are based on the reported level of the index derived from the last reported prices of the constituent securities of the index at the closing on the day of exercise. The exercise settlement values of other options are based on the reported level of the index derived from the opening prices of the constitu- ent securities on the day of exercise. If an option is exercised on a day that is not scheduled as a trading day for the constituent securities of the index, the exer- cise settlement value is based on the reported level of the index derived from the opening or closing prices (depending on the options series) of the constituent securities on the last prior day that is scheduled as a trading day. If a particular constituent security does not open for trading on the day the exercise settlement value is determined, the last reported price of that se- curity is used. Other means for determining the exer- cise settlement values of some index options series have been. and may continue to be, established. For example, the exercise settlement values for options on an index of foreign securities may be fixed in relation to a value fixed by a foreign exchange. 27 CONFIDENTIAL - PURSUANT TODEIESCIRIQWW788 P. 6(e) CONFIDENTIAL SDNY_GM_00183972 EFTA01353424